New Report Reveals the Cold Chain’s £14 Billion Impact on the UK Economy
Today, the Cold Chain Federation unveiled the anticipated Cold Chain Report 2024 at Cold Chain Live! 2024. In addition to updated statistics on cold storage and temperature-controlled distribution, this year’s Report includes the results of a major new study by Oxford Economics examining the critical role of the cold chain sector in driving economic activity across the UK.
The cold chain ensures the safe storage and transportation of temperature-sensitive products such as food and beverages, medicines, and horticultural products.
The report looked at three channels of impact this global sector has across all four corners of the UK: Direct, Indirect and Induced.
Key Findings:
- £14 billion gross value added (GVA) contribution to UK GDP
- 184,000 jobs supported by the sector
- £3.7 billion in tax revenue generated for the UK government
Due to the geographically widespread nature of the sector, the cold chain supports economic activity across all regions of the UK. Of the overall jobs supported across the country by the cold chain, most were concentrated in the East Midlands (23,000), East of England (22,000), North West (21,000).
One new element of the report is the introduction of maritime trade and its use of refrigerated shipping containers (reefers). Last year, 342,425 were imported into UK ports, which was no change from 2022. London Gateway is the busiest port, with 51% of all traffic coming through the site. The sector saw a 9% decrease in exports.
State of the Cold Chain
One aspect of the report looked at year-on-year comparisons of the cold chain sector. A key worry for the sector is that energy costs have jumped by 46% in 2023 compared to 2022. On a more positive note, the sector has seen over a quarter of cold stores running on renewable energy. Other key numbers include:
- The number of cold stores operating blast freezers increased by 3% in 2023, when compared to 2022
- The use of CO2 as a primary refrigerant in cold stores increased by 4%, whilst ammonia and HFCs each reduced by 2%
- The cost of diesel used in Transport Refrigeration Units increased by 4% in 2023
Beyond the Numbers:
- The report highlights the cold chain’s vital role in supporting:
- UK manufacturing: Facilitating £53 billion in chilled and frozen food, beverages, and pharmaceutical sales in 2023.
- International trade: Supporting £12 billion in UK exports and £32 billion in frozen and chilled goods imports.
- Regional economies: Driving economic activity across all regions with significant job concentrations in the East Midlands, East of England, North West, and Yorkshire and the Humber.
Enabling Economic Activity Across Sectors
Impact on UK Manufacturing
The report reveals that nearly half (49%) of all food and beverages produced in the UK – valued at £50 billion – require chilling or freezing. This underscores the importance of the cold chain for sectors like food and beverage processing and pharmaceuticals.
Supporting Horticulture
The study also highlights the crucial role of the cold chain in the UK’s horticultural sector. Since all horticultural products require temperature-controlled storage and transportation, the cold chain contributes to the production of £1.7 billion worth of ornamental plants in 2023.
Prof Toby Peters, Professor of Cold Economy, University of Birmingham said,
“The cold chain has a critical role to play in a future sustainable and prosperous UK and this Report helps shines a light on the criticality of supporting cold chain development and will help ensure the sector finally gets the recognition it deserves. The landscape in which the UK’s cold chain operates has undergone profound change in recent years. In the face of a multitude of pressures from external factors such as rapidly changing consumer demands and trade flows following Brexit, the industry is also adapting to a changing climate and the need to be sustainable. There are promising signs of progress but much more still to be achieved”
Tom Southall, Deputy CEO of Cold Chain Federation said,
“The Cold Chain Report 2024 unequivocally demonstrates the cold chain’s status as a cornerstone of the UK economy; from supporting millions of jobs to facilitating billions in trade, this sector is a vital engine of growth. We urge policymakers and industry leaders to recognise the cold chain’s immense potential and invest in its continued development.”
Cold Chain Live! 2024, the definitive conference for the UK’s temperature-controlled storage and distribution industry, will see 500 food logistics professionals gather in Telford for two days of insight, discussion and debate about the UK cold chain’s key challenges and opportunities.
Other key topics discussed at the Cold Chain Live conference include the State of the UK cold chain in 2024, embracing a changing workforce to futureproof the cold chain, sustainability, and resilience & social responsibility.
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